Abstract Mood disorders, including major depressive (MDD) and bipolar (BD), are highly disabling and affect 60 million Americans. Depressive and manic symptoms impair episodic and working memory and overall psychosocial functioning in affected individuals. We will use the mood spectrum approach and functional magnetic resonance imaging to determine the relationship among continuous constructs of depression (ranging from no depression to sub-threshold depression to syndromal depression) and mania (ranging from no mania to sub- threshold mania to syndromal mania) symptoms, brain and behavior measures of episodic and working memory, and psychosocial dysfunction across MDD and BD diagnoses. We propose that aberrant anticipatory processing preceding performance on episodic and working memory tasks may be an important factor that mediates the relationship between mood symptoms and functioning in individuals with MDD and BD. Healthy individuals and those with MDD and BD will undergo clinical evaluation at baseline, 6, and 12 months. They will be scanned at baseline and at 6 months. We expect to collect longitudinal neuroimaging and clinical data from 150 individuals (across diagnoses). We will identify brain regions whose activation during anticipation of happy, fear, and neutral faces correlates with episodic memory accuracy and lifetime and current depression and mania spectrum symptoms and psychosocial functioning (Aim 1). We will identify brain regions that differentially activate during anticipation of easy and difficult working memory tasks, and correlate with lifetime and current depression and mania spectrum symptoms and psychosocial functioning (Aim 2). Quality of life for affected individuals could be improved if it were possible to predict and prevent worsening of clinical symptoms and decline in functioning. We will use multiple regression, mixed models, classification, trajectory, and path analyses to examine the role of anticipatory processing in the relationship between longitudinal trajectories in mood symptoms and brain and behavior measures of episodic and working memory and longitudinal trajectories in psychosocial functioning (Aim 3). To compare dimensional and categorical approaches, we will compare main neuroimaging and behavioral measures in MDD vs. BD, and perform a Group-by-Symptom interaction analyses. We will also explore how anticipation strategies and affective bias contribute to clinical and functional outcomes described above (Exploratory Aims). The proposed research will lay the foundation for understanding neural correlates underlying longitudinal trajectories in mood spectrum symptoms and psychosocial functioning in mood disorders. If the mediating role of anticipatory processing for clinical and functional outcomes is confirmed, anticipatory processing may become a new treatment target for affected individuals. Addressing dysfunctional anticipatory processing may help predict occurrence of syndromal episodes of depression and mania and related psychosocial impairments leading to disability.